Exxon, BHP Billiton to Invest $1 Billion in Australian Gas Plant

Dec. 13 (Bloomberg) -- Exxon Mobil Corp. and BHP Billiton
Ltd. approved investment of more than $1 billion on a new plant
to process natural gas from the Kipper and Turrum project off
the southeast coast of Australia.

The plant in Victoria state will remove carbon dioxide from
gas produced at the Turrum venture, Melbourne-based BHP said
today in a statement. BHP, Australia’s largest oil producer,
said it will spend $520 million on the Longford gas treatment
facility. Exxon’s Esso Australia Resources Pty said in a
separate statement that it will invest A$500 million ($527
million) for its share.

“Australian energy consumption will continue to grow
during the next 20 years,” Exxon Australia Chairman John
Dashwood said in the statement. “The gas conditioning plant
will process gas to help meet this expected increase.”

Exxon, the world’s largest energy company by market value,
and its partner BHP said last year that the cost to develop the
Kipper and Turrum fields rose by more than 60 percent to $4.4
billion and that the project would be delayed, partly because of
mercury found during drilling. Exxon said in October it expects
a decision at the end of 2013 to develop facilities to remove
mercury from gas extracted from the Kipper field.

Exxon advised that first gas from Kipper is most likely in
the first half of 2016, partner Santos Ltd. said in July.

The Longford plant will process about 400 million standard
cubic feet of gas daily and will cut carbon dioxide content to
less than 3 percent, according to the statement. Saleable gas
output at Turrum will start in 2016, BHP said.

BHP, which earned 18 percent of revenue from its petroleum
division in fiscal 2012, agreed yesterday to sell its stake in
Woodside Petroleum Ltd.’s Browse liquefied natural gas venture
in Western Australia to PetroChina Co. for $1.63 billion.